Start a Business in Europe in 2025
Are you looking to set up your new business or grow our existing business? Are you looking to grow your clientele and target a profitable region? If yes, then you should set up your business in Europe. In Europe, lakhs and lakhs of people register their businesses every year.
But have you ever wondered what makes Europe such an attractive location for business entrepreneurs? One of the reasons that attracts business entrepreneurs is the accessibility to a huge clientele. Setting up a business in Europe provides business owners with access to over 448 million people. In addition to that, starting a business in Europe provides easy access to its member nations such as Poland, Netherlands, Lithuania, and so on.
Why Start a Business in Europe?
Starting a business in Europe is a powerful step towards accessing a high-income market, thriving in a stable economy, and capitalizing on unmatched business-friendly policies. Europe’s appeal lies in its diverse yet cohesive economic landscape, with a market that caters to all types of business models, from tech startups to established manufacturing companies.
Here are compelling reasons for business owners to consider Europe:
- Access to a Wealthy Consumer Market: Europe is home to over 500 million consumers, many with high purchasing power. For businesses, this means a ready audience for innovative products and services.
- Business-Friendly Ecosystem: With streamlined processes, comprehensive support for entrepreneurs, and competitive tax incentives, European countries prioritize making it easy for businesses to launch and scale.
- Innovation and Talent Hub: Europe leads globally in R&D investments, making it a prime location for tech-driven businesses. Additionally, it offers a highly skilled workforce across various industries, with expertise in technology, engineering, finance, and beyond.
- Seamless Trade Across Borders: The European Union offers seamless trade across 27 member countries, eliminating tariffs and customs complications, which is particularly advantageous for companies aiming to expand.
Requirements for Setting up a Business in Europe
1. Despite the different laws regarding permits for business for foreigners, there’s one law that most European nations possess, those who are planning to establish businesses do not require an employment permit or other kind of visa.
2. If you want to start a business in Europe, another requirement is to have a residence permit in the nation where you are planning to establish your business. These permits are for a limited time initially but after a few years, based on the growth of your business it is possible to secure a long-term residence permit.
3. There are many kinds of companies which you can start to be eligible for a residency permit. In order to start a business in Europe, you need to choose a legal form for your business. You can choose to set up a sole proprietorship, an association with a branch or office of a foreign business, or even a company that is registered in the country you are hosting.
4. If your business or self-employment activities are likely to contribute significant contributions to the economics, culture, and/or sciences of your destination There is a small chance that your application will be approved and that you’ll receive a residency permit.
5. To obtain an immigration permit for setting up a business, certain countries require a business plan which is then reviewed by immigration and labor officials to determine if the plan meets the requirements of the nation.
6. In the end, the business plan you submit must demonstrate that you intend to invest in and offer services that satisfy demand in the nation of your choice. Certain countries require you to demonstrate a certain amount of funds to finance the start-up.
7. If you are planning to establish a company within the UK (pre & post-departure) such as you must have a minimum of $50,000 to invest in your venture and additional money (200,000 dollars) to help you and your family until the business becomes profitable.
Best Places to Start a Business in Europe
Europe is a powerhouse for business, offering entrepreneurs a blend of innovation, skilled talent, and access to a vast market.
Here’s how to get started in four leading European countries:
Poland
Known for its low operational costs and tax-friendly zones, Poland is a magnet for startups, especially in tech and manufacturing. You can start a business in Poland by registering with the National Court Register (KRS) via the CEIDG portal. Special economic zones offer significant tax breaks, making it easier for foreign businesses to grow quickly.
Netherlands
The Netherlands is a gateway to European markets, offering top infrastructure and an easy, digital setup with the Dutch Chamber of Commerce (KVK). The Netherlands provides tax benefits like the Innovation Box, lowering taxes on profits from innovation—a perfect fit for tech-driven and sustainable businesses.
Are you looking to grow your business in the Netherlands, schedule a meeting with our business experts right now.
Germany
As Europe’s largest economy, Germany combines stability with a highly skilled workforce. Register your business in Germany with the local Trade Office (Gewerbeamt) and Commercial Register (Handelsregister) to get started. Germany rewards R&D-intensive businesses with tax deductions and is especially strong in engineering, manufacturing, and green technology.
Spain
Spain is a vibrant market ideal for companies in tourism, real estate, and tech. Business registration in Spain is straightforward: secure a company name certificate, and a tax identification number (NIF), and register with the Commercial Registry. Spain’s government offers substantial tax incentives for R&D, especially in emerging tech and innovation sectors.
How Easy is it to Set Up a Business?
There are many studies by major international organizations like the World Bank that regularly evaluate the business-friendly environment of nations around the world.
The Bank’s Ease of Doing Business Index project provides objective measurements of business regulations as well as their application across 190 countries and select cities across the globe.
The report outlines some requirements that are essential for business operations like beginning a business and dealing with construction, hiring workers, registering properties as well as obtaining credit and making payments for taxes, transacting across borders, enforcing contracts and more.
In the report for 2018 by the World Bank report, the top-ranked European nations are
- Denmark (#3)
- Norway (#7)
- UK (#9)
- Sweden (#12)
- Finland (#17)
Other large economies in Europe are ranked a bit lower
- Ireland (#23)
- Germany (#24)
- Austria (#26)
- Spain (#30)
- France (#32)
- Poland (#33)
- Czech Republic(#34)
- Portugal (#36)
- Switzerland (#38)
- Switzerland (#45)
- Italy (#51)
How Competitive is the Business Environment?
Another popular indicator that is frequently used Global Competitiveness Report which is released every year through the World Economic Forum.
Relying on the explanation of the World Economic Forum it is the Global Competitiveness Report “specifies impediments to development & thereby assists the growth of pertinent techniques to accomplish sustained economic growth.
Its Country Profile Highlights provide an outline of the positive aspects of each nation’s economy. Sweden, Finland, and Denmark for instance are all listed as among the top 17 nations for macroeconomic stability and stability.
They also have good budget surpluses as well as low amounts of public indebtedness. Germany however, on the contrary, is listed as the top in the world for its quality of infrastructure, specifically communications and transportation.
France is also praised for its great infrastructure particularly when it comes to communications, transportation, and energy.
Economic Freedom
The political conservatism Index of Economic Freedom is a collection of economic indicators that are published each year through the Heritage Foundation.
The index explains, “Economic liberty is the primary right of all human beings to prevail in restraint of their job as well as property. In an economy-free society, citizens have the freedom to work and produce, consume and invest however they choose.
The report ranks 186 nations around the world. Surprisingly, the top-ranked European countries are
- Switzerland (#4),
- Ireland (#6)
- UK (#7)
the only European country to be included in their top 10 (interestingly, Canada is ranked at #8, and Canada is listed as number 8 while the U.S. is ranked #12).
Corruption, Cronyism, Organized Crime, and many other Woes
Corruption is a fundamental aspect of business in several European countries. However, the majority of European countries have a very little or moderate degree of corruption that doesn’t significantly hinder the running of a successful business.
Clarity International’s Corruption Perceptions Index (CPI), a yearly disclosed analysis of corruption around the world can be utilized to assess how much corruption affects everyday life, politics, and the economy of 180 countries across the world.
It is the Corruption Perceptions Index (CPI) is a “survey of surveys”, that depends on 13 several experts’ calculations as well as business-related analyses.
The 2019 rankings exhibit that in common Scandinavian as well as Central European nations possess very low levels of corruption, according to an autonomous CPI:
- Denmark (#1)
- Finland (#3)
- Sweden (#4-tie)
- Switzerland (#4-tie)
- Norway (#7)
- Netherlands (#8)
- Luxemburg (#9-tie)
- Germany (#9-tie)
- Iceland (#11)
- UK (#12-tie)
- Austria (#12-tie)
- Belgium (#17)
- Ireland (#18)
- France (#23)
In 2019, there are a few southern European countries are on the contrary according to The report that corruption is a greater number of countries, which include:
- Portugal (#30)
- Spain (#30)
- Cyprus (#41)
- Malta (#50)
- Italy (#51)
A lot of Eastern or South-eastern European countries also rank relatively low in the corruption index of the report:
- Estonia (#18)
- Poland (#41)
- Slovenia (#35-tie)
- Lithuania (#35-tie)
- Latvia (#44-tie)
- Czech Republic (#44)
- Slovakia (#59)
- Greece (#60)
- Croatia (#63)
- Montenegro (#66-tie)
- Romania (#70-tie)
- Hungary (#70-tie)
- Armenia (#76)
- Turkey (#91)
- Serbia (#91)
It is also fascinating to observe that a handful of the ex-Soviet Republics located in Eastern Europe have been given some of the highest corruption indexes around the globe, as per an independent study:
- Belarus (#70)
- Bulgaria (#74)
- Kosova (#101-tie)
- Bosnia and Herzegovina (#101-tie)
- North Macedonia (#104)
- Albania (#106)
- Ukraine (#126-tie)
- Kyrgyzstan (#126-tie)
- Russia (#137)
- Turkmenistan(#165)
Europe's Leading Business Cities
Cushman & Wakefield, a privately owned commercial real estate firm, is the publisher of its European Cities Monitor which is an annual study of the major European business centers that is based on information and evaluations from 500 top European firms.
London has maintained its top spot since the inception of the survey in the year 1990. These are the top 10 European most renowned business cities:
- London (#1)
- Paris (#2)
- Amsterdam (#3)
- Berlin (#4)
- Frankfurt (#5)
- Copenhagen (#6)
- Munich (#7)
- Dublin (#8)
- Milan (#9)
- Vienna (#10)
Conclusion
There are plenty of options for entrepreneurs looking to enter a vibrant and diverse market when they launch their firm in Europe. Europe is a desirable location for businesses of all sizes and sectors due to its innovative business environment, highly skilled labor force, and strong infrastructure. Entrepreneurs can open their businesses in the developing economies of Poland, the Netherlands, and Germany.
Our experts at OnDemand International can assist you with the procedure of registering your business in Europe. We’ll help you register your name, collect the necessary paperwork, and assist you in opening a bank account so you can handle the funds of your company. Get in touch with our business consultants right now to launch your company in Europe.
FAQ’s
Poland is one of the easiest place in Europe to establish a new company.
It is possible to form an EU firm directly with the authorities, or via the online registration for companies within the Europe system.
Despite the various laws on permits for foreign-owned businesses, however, there is a common rule the majority of European countries have in common: foreigners intending to start a business don’t require a work permit or any other visa.
Hungary is home to one of the lower corporate taxes in Europe and is taxed at 9 % of earnings from corporations. Local business taxes are payable to the municipalities, but the amount varies and is only allowed to be 2% of the net sales revenue.
In the year 2020, it was reported that the World Bank ranked eight European countries on its top 20 rankings for “Ease of doing business ranking” therefore there are many options for you to consider.
Poland and the Netherlands stand out as two of the best countries for registering a business in Europe.
- Poland- Poland is preferred for business incorporation in Europe due to its low taxation, robust investor rights protection, and ease of company formation. Additional factors contributing to Poland’s growing appeal to foreign investors include its accessibility to a competent labor force and various governmental grants.
- Netherlands- The Netherlands emerges as a highly favored jurisdiction for business registration, due to its attractive tax incentives, skilled workforce, and excellent infrastructure. Its strategic location enables seamless trade with other European countries, while the Port of Rotterdam which is a major European port, facilitates efficient travel and transportation.
If you’re planning to relocate to Europe for business purposes, opting to set up a limited company offers a quicker and more advantageous approach. A limited company offers limited liability protection, easier access to capital, and perpetual succession.
